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Council approves amended TNC ordinance

Friday, October 17, 2014 by Tyler Whitson

Following an extensive discussion and several amendments, City Council approved an ordinance Thursday that will temporarily legalize transportation network companies such as Lyft and Uber in Austin on final reading.

The ordinance directs the City Manager to enter into an operating agreement with TNCs within 30 days of the effective date.

Council Member Laura Morrison, who proposed several amendments on the dais, also cast the sole opposition vote Thursday. She said that there were “a lot of things that needed to be cleaned up” in the ordinance and that she “caught several,” but wasn’t sure if there are more.

“I still think that doing this in the broader realm of making sure that we’re integrating the other vehicle for hire companies and services adequately — and services to all of the folks that need it — would be the appropriate way to go,” Morrison said.

Uber General Manager for Texas Chris Nakutis told the Monitor shortly after the vote that his initial assessment was that “it looks like a great ordinance that Austinites deserve.”

Though Nakutis said that Uber would need to read over the amended ordinance before making a final assessment, he said that Council has “come up with a regulatory framework that protects consumer safety and at the same time allows (new) industries to blossom in the city.”

Austin Yellow Cab President Ed Kargbo offered the Monitor the perspective of the taxi cab industry, which will likely be facing increased competition. “I think it’s clear to everybody that taxis are still the safest option,” he said.

When asked about comments that Council members made about leveling the playing field so that taxi cab and TNC drivers adhere to similar requirements and regulations, Kargbo said that “if the standards are to make sure that the consumer is protected and that public safety is taken into consideration, we’re happy to play by those rules.”

The two main issues that Council wrestled with involved background checks and insurance.

Though initially amending the ordinance to require that TNC drivers pass city-led background checks, Council opted in the end to adopt the approach that Houston has taken on the issue. This essentially requires that TNCs conduct their own background checks at their own expense, then pass the results along to the city to review and confirm.

This amendment followed Lyft Public Policy Manager April Mims’ comment that her company was concerned that requiring the background checks to be city-led could create an additional delay for applicants, thereby providing a “disincentive” to potential drivers.

Nakutis said he is in favor of the policy that the city adopted. “We stand behind our background checks,” he said. “This is an added audit from the city to ensure that the background checks that we’re doing remain best-in-class.”

Council Member Bill Spelman proposed an amendment to the ordinance’s requirement that TNCs provide primary commercial insurance coverage from the time that a driver logs in to the app and indicates that he or she is available to receive ride requests to the time that a driver accepts a request, a time window that Lyft and Uber representatives call “period one.”

The new language is modeled after Governor-approved California Assembly Bill 2293 and requires that TNCs provide drivers with limited insurance during period one. It also includes language that allows drivers to use a type of hybrid TNC insurance that they would purchase themselves when it presumably comes on the market in the future.

David Witte, a member of disability advocacy group ADAPT Texas who is also a member of both the TNC Working Group and the Taxi Cab Task Force — both stakeholder groups organized by the city — said that there is a need for more wheelchair-accessible service across the board. “Basically, I just think there should be more rides available, because it’s already hard to get a ride as it is,” he said.


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